GRAND RAPIDS -- With a hefty new contract from the government under its belt, but not yet made public, Steelcase Inc. said Monday the deal and others around the globe will help it weather almost any storm, political or financial.

An upbeat view of the office furniture giant's second quarter started with the company's profits topping analysts' expectations by a penny, although the quarter's $31.4 million profit was 17 percent below a year ago.

Once heavily dependent on the finance and banking industry, Steelcase now goes higher and wider, said Jim Hackett, chief executive officer.

Jim Hackett

More office furniture sales in energy, health care, government, higher education, and technical-professional sectors help soften losses from the ailing New York-based financial industry. And its sales growth encircles the globe, with top regions ranging from Germany to Australia.

New products and an aggressive restructuring plan spawned in the 2003 recession also are crucial to Steelcase's survival, he said.

The drive for greener manufacturing is also a big effort.

"Sustainability is going to be a big deal," Hackett told analysts. "It won't be OK for companies to profit and pollute."

Steelcase's second-quarter sales were $901.8 million, driven by higher international sales and a favorable currency rate based on a lower U.S. dollar.

Restructuring costs hit the bottom line at the rate of $5.1 million.

Plant closings, layoffs and buyouts this summer included 250 white-collar jobs in Grand Rapids. Most of the savings from those cutbacks will be realized in the next six months, the company said.

The downturn in the U.S. economy is hitting office furniture companies hard, with production industrywide forecast to drop by more than 10 percent in 2009. Favorable currency rates and sales overseas are helping, but the raw materials expense is offsetting some of that growth.

This summer, Steelcase raised its prices. On Sept. 1, the company initiated a surcharge on raw materials.

For its third quarter, expectations are subdued, with sales expected between $840 million and $875 million, lower than the $885.9 million last year. Profits are expected to hit 16 cents to 21 cents per share, including $6 million in ongoing restructuring costs.

In a tough economy, Steelcase Chief Financial Officer Dave Sylvester said the company will "modestly build up cash."

"Frankly, there could be some opportunities for us to reinvest back into the business," he said. "In times like these, you start to see some things that weren't an opportunity before present themselves as opportunities today."

Many of the financial institutions making headlines are Steelcase customers, and some of the mergers involve customers on both sides of the deal. That might provide a fresh market for office furniture as the mergers evolve.

Although the pace of orders is down going into the third quarter, the company sees its diversity into more sectors and more continents a winning combination.

"I believe the company's in a good position to handle adversity," Hackett said. "It's time for a little optimism."

Steelcase was one of just a handful of stocks to close in the black Monday, after the U.S. House of Representatives voted down a huge financial bailout package.

On the New York Stock Exchange, Steelcase closed at $10.86, up 42 cents or nearly 4 percent, as the Dow Jones industrial average plunged 777 points, a 7 percent drop.